Comair bids for Air BotswanaN$1 billion in the kitty for acquisitions Comair is also looking for other acquisitions but is keeping a tight lid on its targets. South Africa's Comair will submit a proposal to Botswana take over the nation's carrier, Comair's chief executive said last week.
Comair, which operates British Airways in southern Africa alongside its no-frills brand Kulula.com, has vied for Air Botswana before, but in 2008 pulled out of a bidding round that failed to attract successful suitors.
Botswana last Monday again put its national carrier up for tender as part of a strategy to privatise loss-making state companies.
“We'll make a submission and see if they are interested in our approach,” Comair chief executive Erik Venter told Reuters, adding that proposals had to be made before the end of February.
Botswana's transport department has said it is open to proposals on various forms of privatisation including joint ventures, ownership, franchising and concessions.
Comair wants equity in and control of the airline that connects four Botswana towns to South Africa, Venter said.
“We'd even look at a management contract, but it would have to be on the basis that we run a large amount of it from Comair to get economies of scale,” he said.
Botswana Air, which provides cargo and air passenger services to Cape Town and Johannesburg from Gaborone, Francistown and the tourism hubs of Maun and Kasane, has been a drain on state finances.
Financial losses, blamed on a large workforce and an ageing fleet, have prompted a five-year turnaround plan that includes cutting costs and cancelling unprofitable routes.
“It needs economies of scale and a small airline on its own is never going to achieve that,” Venter said, adding that a takeover would mean moving some of the airline's services to Johannesburg.
Botswana Air, which recently discontinued flights to Harare and Lusaka from Gaborone, halved its operating losses to 83 million Pula (US$8 million) in the 2016 fiscal year.
Venter thinks the airline is unlikely to attract cash offers from suitors.
“I don't think there is any money involved in this one, to be honest. We wouldn't pay for it, that's for sure,” he said.
Comair is also looking for other acquisitions, Venter said, without providing further details.
Chief financial officer Kirsten King told Reuters in a separate interview that Comair has as much as N$1 billion available for acquisitions and other projects.
MONEYWEB
Comair, which operates British Airways in southern Africa alongside its no-frills brand Kulula.com, has vied for Air Botswana before, but in 2008 pulled out of a bidding round that failed to attract successful suitors.
Botswana last Monday again put its national carrier up for tender as part of a strategy to privatise loss-making state companies.
“We'll make a submission and see if they are interested in our approach,” Comair chief executive Erik Venter told Reuters, adding that proposals had to be made before the end of February.
Botswana's transport department has said it is open to proposals on various forms of privatisation including joint ventures, ownership, franchising and concessions.
Comair wants equity in and control of the airline that connects four Botswana towns to South Africa, Venter said.
“We'd even look at a management contract, but it would have to be on the basis that we run a large amount of it from Comair to get economies of scale,” he said.
Botswana Air, which provides cargo and air passenger services to Cape Town and Johannesburg from Gaborone, Francistown and the tourism hubs of Maun and Kasane, has been a drain on state finances.
Financial losses, blamed on a large workforce and an ageing fleet, have prompted a five-year turnaround plan that includes cutting costs and cancelling unprofitable routes.
“It needs economies of scale and a small airline on its own is never going to achieve that,” Venter said, adding that a takeover would mean moving some of the airline's services to Johannesburg.
Botswana Air, which recently discontinued flights to Harare and Lusaka from Gaborone, halved its operating losses to 83 million Pula (US$8 million) in the 2016 fiscal year.
Venter thinks the airline is unlikely to attract cash offers from suitors.
“I don't think there is any money involved in this one, to be honest. We wouldn't pay for it, that's for sure,” he said.
Comair is also looking for other acquisitions, Venter said, without providing further details.
Chief financial officer Kirsten King told Reuters in a separate interview that Comair has as much as N$1 billion available for acquisitions and other projects.
MONEYWEB